Immutable, a Web3 gaming company, revealed on Friday that it has been served a Wells Notice by the US Securities and Exchange Commission. The notice was received shortly after the company's initial interaction with the SEC and lacked substantial details about the investigation, instead citing statutory provisions. Immutable believes the SEC's claims are focused on the private sales and listing of its IMX token in 2021, as mentioned in a blog post about a pre-launch private purchase by Huobi Ventures Blockchain Fund. The IMX token has dropped over 13% to $1.16 in the past 24 hours.
A Wells Notice is a formal letter sent by the SEC to individuals or companies after an investigation, indicating plans for a potential lawsuit. Several prominent cryptocurrency companies, including Coinbase, Consensys, Ripple, OpenSea, and Crypto.com, have received similar notices in recent years.
The CEO of Immutable and the Digital Worlds Foundation, the entity behind the IMX token, also received separate notices. Immutable is aware of related inquiries from the DOJ but has not been notified of any actual or proposed legal action.
The company criticized the SEC's approach, stating that manufacturing a case based on a 2021 listing with minimal direct communication is a reason for industry skepticism. Immutable expressed confidence that its IMX token is not a security and is prepared to challenge the SEC's attempted regulation by enforcement.